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Understanding sectoral differences in downward real wage rigidity: workforce composition, institutions, technology and competition. NBB Working Papers. No. 156, 19 February 2009

Caju, Philip Du and Fuss, Catherine and Wintr, Ladislav. (2009) Understanding sectoral differences in downward real wage rigidity: workforce composition, institutions, technology and competition. NBB Working Papers. No. 156, 19 February 2009. [Working Paper]

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    Abstract

    This paper examines whether differences in wage rigidity across sectors can be explained by differences in workforce composition, competition, technology and wage-bargaining institutions. We adopt the measure of downward real wage rigidity (DRWR) developed by Dickens and Goette (2006), and rely on a large administrative matched employer-employee dataset for Belgium over the period 1990-2002. Firstly, our results indicate that DRWR is significantly higher for white-collar workers and lower for older workers and for workers with higher earnings and bonuses. Secondly, beyond labour force composition effects sectoral differences in DRWR are related to competition, firm size, technology and wage-bargaining institutions. We find that wages are more rigid in more competitive sectors, in labour-intensive sectors, and in sectors with predominant centralised wage setting at the sector level as opposed to firm-level wage agreements.

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    Item Type: Working Paper
    Subjects for non-EU documents: EU policies and themes > Policies & related activities > employment/labour market > industrial/labour relations
    EU policies and themes > Policies & related activities > employment/labour market > labour/labor
    Subjects for EU documents: UNSPECIFIED
    EU Series: UNSPECIFIED
    ["eprint_fieldname_eusries" not defined]: UNSPECIFIED
    EU Annual Reports: UNSPECIFIED
    Series: Series > National Bank of Belgium (Brussels) > Working Papers
    Depositing User: Phil Wilkin
    Official EU Document: No
    Language: English
    Date Deposited: 20 May 2009
    Page Range: p. 43
    Last Modified: 15 Feb 2011 18:11
    URI: http://aei.pitt.edu/id/eprint/10974

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